An army spokesman denied Bentiu had fallen, saying fighting was continuing.

The two sides have repeatedly accused each other of violating a ceasefire signed in January.

More than one million people have been displaced in the conflict, which broke out about a month earlier after South Sudan's President Salva Kiir accused his sacked deputy Riek Machar of plotting a coup.

'Forced oil shutdown'

Mr Machar denied the allegation, but then launched a rebellion to overthrow Mr Kiir.

A large number of South Sudanese have sought refuge in Ethiopia and other neighbouring states

His forces took control of Bentiu, capital of Unity state, soon after the conflict started. However, government forces drove the rebels out of the the city on 10 January.

Unity state is rich in oil, the main foreign exchange earner of South Sudan. Oil production in South Sudan dropped by 20% after the conflict started.

China and Russia are among the major investors in South Sudan's oil industry. Brig Gen Lul Ruai warned firms not to defy the order to shut operations.

Otherwise, they risked a "forced oil shutdown and the safety of their staff", he said.

A UN official in South Sudan, Joe Contreras, said Mongolian peacekeepers had on Monday rescued 10 staff members from the Russian oil company Safinat just north of Bentiu, Associated Press news agency reports.

Two of the five wounded were in critical condition, he said.

The UN has around 8,000 peacekeepers in South Sudan, including a base in Bentiu where thousands of people have taken refuge since fighting broke out in December.

South Sudan's military spokesman Col Philip Aguer said heavy fighting was continuing for control of Bentiu, AFP news agency reports.

"The rebels have tried to penetrate one part of the town but are being held back," he told AFP.

Of the more than one million people displaced by the conflict, 803,200 are taking shelter within the country and another 254,000 have fled to neighbouring countries, according to a UN report released last month.

South Sudan seceded from Sudan in 2011 after a long and bloody conflict, to become the world's newest state.

Sudan's arid north is mainly home to Arabic-speaking Muslims. But in South Sudan there is no dominant culture. The Dinkas and the Nuers are the largest of more than 200 ethnic groups, each with its own languages and traditional beliefs, alongside Christianity and Islam.

Both Sudan and the South are reliant on oil revenue, which accounts for 98% of South Sudan's budget. They have fiercely disagreed over how to divide the oil wealth of the former united state - at one time production was shutdown for more than a year. Some 75% of the oil lies in the South but all the pipelines run north.

The two Sudans are very different geographically. The great divide is visible even from space, as this Nasa satellite image shows. The northern states are a blanket of desert, broken only by the fertile Nile corridor. South Sudan is covered by green swathes of grassland, swamps and tropical forest.

After gaining independence in 2011, South Sudan is the world's newest country - and one of its poorest. Figures from 2010 show some 69% of households now have access to clean water - up from 48% in 2006. However, just 2% of households have water on the premises.

Just 29% of children attend primary school in South Sudan - however, this is also an improvement on the 16% recorded in 2006. About 32% of primary-age boys attend, while just 25% of girls do. Overall, 64% of children who begin primary school reach the last grade.

Almost 28% of children under the age of five in South Sudan are moderately or severely underweight. This compares with the 33% recorded in 2006. Unity state has the highest proportion of children suffering malnourishment (46%), while Central Equatoria has the lowest (17%).